Competition Commission wants BAA to sell two London airports

The Competition Commission has said it wants BAA to sell two of its three London airports - Heathrow, Gatwick and Stansted - as well as either Glasgow or Edinburgh airport.

The preliminary report of its 16-month investigation into BAA's UK airports found that all seven suffered “competition problems” with “adverse consequences for passengers and airlines”.

“A principal cause is their common ownership by BAA,” said the commission's report, published today.

To resolve the problems it recommends the sale of two of BAA's three London airports as well as either Glasgow or Edinburgh airport.

The commission will consult before making a final decision in early 2009 on exactly which airports should be sold.

BAA - which since 2006 has been owned by Spanish property group Ferrovial - also owns Southampton and Aberdeen airports as well as the three London airports and those at Edinburgh and Glasgow. Sale of these two has not been proposed.

The chairman of BAA, Sir Nigel Rudd, told the BBC earlier this week that he expected a break-up to be ordered and that there had already been “huge expressions of interest” from potential buyers of Gatwick and Stansted.

Although Gatwick and Stansted airports are not at present for sale, the operator has already indicated that it is unlikely to sell Heathrow.

The Competition Commission report also found competition problems arising from the planning system, aspects of government policy and the system of regulation.

It will now seek views “on those aspects of government policy which adversely affect competition by restricting or distorting the development of airport capacity”.

However, the report added that there was “no need to make similar recommendations on the planning system as these are already being addressed by government”.